(Reuters) - American companies can expect
progress on some critical U.S. trade initiatives if the Republican Party
takes control of both houses of the U.S. Congress this November.

A Republican victory in the Senate may prevent the chamber's
Democrats, backed by labor unions concerned about the impact of free
trade on American jobs, from blocking trade legislation favored by
both President Barack Obama and Republican leaders.

Pollsters currently see the Republicans with a reasonable chance of
winning just enough seats to gain control of the Senate in mid-term
elections, which would give them their first majority in both
chambers since 2006. They easily control the House of
Representatives.

There should be enough support from Republican lawmakers to advance
trade legislation, though some Tea Party members are also wary of
such deals. One area that might take a hit is future funding of the
Export-Import Bank of the United States, the nation's export credit
agency, as some conservatives see it providing “corporate welfare”
through loans to foreign buyers of goods made by major U.S.
companies.

A change in control of the Senate could smooth the way toward
passage of a broad trade agreement with 11 Asia-Pacific nations and
another pact with the European Union, said political strategists
advising Wall Street firms. The trade deals could benefit exporters
of agricultural produce, chemicals and auto parts, among other
products and services.

The Republicans could also help get approvals for more exports of
U.S. energy products, in abundance because of the shale oil and gas
boom, to Europe and Asia.

“A unified Congress in one party could lead to a compromise" on
trade, said Daniel Clifton, head of policy research at Strategas
Research Partners in Washington.

The Obama Administration's desire for fast-track negotiating powers,
which Democrat Senate Majority Leader Harry Reid opposes, could be
granted in a Republican-controlled chamber. Fast-track authority
sets objectives for U.S. trade negotiators in exchange for an
up-or-down vote in Congress on trade deals, with no amendments
allowed. Without this any deal Obama negotiated could be subject to
amendments that could destroy it.

Many trade experts say this would aid talks on the Trans-Pacific
Partnership (TPP), which is now in its fifth year of negotiations.
Central to Obama's strategic shift toward Asia, the TPP would
connect many countries, including the U.S. and Japan, by cutting
trade barriers and harmonizing standards in a deal covering a third
of global trade.

Estimates from the Peterson Institute put the potential increase in
U.S. exports from the TPP at about $124 billion annually, mostly in
business and financial services as well as agricultural and other
products. Cracking open Japan’s protected farm market is a key goal
for the United States – while Japan was the fourth-largest importer
of U.S. agriculture products, with $12.1 billion in sales in 2013,
it is seen as having much bigger potential.

"We'd be getting (certain) U.S. agriculture products into Japan for
the first time in 80 years," Clifton said.

Companies such as chicken, beef and pork producer Tyson Foods and
agrochemical and genetically modified seeds company Monsanto Co have
been lobbying for the TPP. Tyson is the largest U.S. exporter of
beef; and Japan now imposes a 38 percent tariff on beef imports.

Still, some U.S. farmers are angry over growing signs that Japan
could maintain certain barriers to imports, including beef, sugar or
dairy products, as part of TPP compromises. If tariffs are not cut
sufficiently, that could anger farmers, and invite Republican
opposition to a deal.

Republican congressional control would also open the door to more
natural gas exports to Asia and Europe. Japan is the biggest
importer of liquefied natural gas, though it does not currently
import from the U.S.

"My gut would be that they’d (Republicans) be more pro-energy which
would probably have a positive impact on natural gas," said Gary
Bradshaw, portfolio manager at Hodges Capital Management, which has
more than $2 billion in assets.

Hodges owns shares in Cheniere Energy, which is currently turning
its LNG import terminal in Cameron Parish, Louisiana into an export
terminal. Other potential beneficiaries are Sempra Energy and
Dominion Resources, that have approvals to develop export terminals
at existing sites.

A Republican-controlled Senate could raise the
pressure on federal agencies to approve more LNG exports,
particularly to Europe so that it doesn't have to be so reliant on
energy supplies from Russia, a major issue given the Ukraine crisis.
But environmental reviews and the time needed to build facilities
means speeding up that process would be difficult.

It may not, though, guarantee a smooth ride for companies that
benefit from the Ex-Im Bank, which provides financing that helps
many foreign companies make purchases from U.S. companies.

Some conservative Republican lawmakers argue it provides financial
help to companies such as Boeing Co that don’t need it, and that it
distorts the free market. The shock defeat last week of Republican
Majority Leader Eric Cantor by a Tea Party candidate in a primary
strengthened that opposition.

The bank's charter will expire at the end of September, and needs to
be reauthorized by Congress if funding for its loan making is to
continue.

Cantor was the Republican who got it support in Congress, said Loren
Smith, research analyst at Capital Alpha Partners in Washington. "It
now becomes very difficult for an authorization to pass unless
there's some kind of reform or scale-back."

One opponent is House Financial Services Committee Chairman Jeb
Hensarling of Texas, whose committee has jurisdiction over the bank.
He and others opposed the renewal in 2012, saying it benefits some
companies at the cost of others. Delta Air Lines has also spoken out
against it, saying it favors foreign competitors who can buy Boeing
Co planes more cheaply than U.S. airlines can. Since 2007, Ex-Im
financing of Boeing sales totals about $50 billion, according to
bank statistics.

Boeing’s shares fell more than 2 percent Wednesday, the day after
Cantor's loss, and declined more than 4 percent for the week. A
spokesperson for Boeing declined comment.

Smaller companies benefit from Ex-Im Bank as well, such as Atlas Air
Worldwide, a Purchase, N.Y.-based aviation services company that has
been New York State’s top beneficiary of the bank's disbursements
since 2007, at $711 million. Its shares declined 1.6 percent last
week.

(Reporting By David Gaffen; additional reporting by Andrea
Shalal-Esa in Washington)